What is the significance of all the users and groups?

I’m a newbie just kind of toying with setting up a web server. I found a tutorial that said to change ownership of a new domain’s directory to www-data:www-data but then I noticed the default directory was root:root.

So I now have these questions:

1. I found that there is already a user and group called www-data but what does that mean?
2. When someone visits the website they’re viewing it as the www-data user?
3. Is that a default user or is it something nginx created?
4. Does the www-data group have limited permissions or something?